Hewlett Packard Enterprise announced elevated guidance for fiscal 2027 during remarks at the Goldman Sachs Communacopia + Technology Conference, projecting revenue growth of 13% to 17% and earnings per share growth of 16% to 20%. The company also raised its free-cash-flow target to at least $5 billion for fiscal 2027, up from an earlier target of at least $3.75 billion for fiscal 2026. Chief Strategy Officer Shannon Cross attributed the optimistic outlook primarily to robust demand for artificial intelligence networking infrastructure.
Networking orders showed particularly strong momentum, rising 36% during the latest quarter. The company elevated its fiscal 2026 target for AI-networking orders to between $2.5 billion and $3 billion, compared with a previous target of $1.5 billion. In related server business, HPE reported $2.4 billion in quarterly AI-server orders and approximately $7 billion in backlog. Cross noted that traditional server orders increased 75% year over year, while storage revenue grew 10% with order growth running at roughly twice that rate. Networking revenue increased 10% during the quarter.
HPE’s confidence in its expanded outlook reflects larger multiyear supply agreements for components in tight supply, with disclosed purchase commitments rising from $6 billion to $30 billion. Cross emphasized that demand remains strong across the company’s product portfolio, with the primary challenge being the ability to deliver products to customers rather than generating orders. The company maintained a selective approach to AI server deals, avoiding what Cross characterized as insufficient-margin opportunities.
The company highlighted several strategic developments supporting its growth trajectory. HPE secured a competitive win with Oracle for an AI data-center opportunity involving routing, switching, and liquid-cooled products. The Juniper Networks combination, completed earlier, is expected to expand addressable markets in enterprise and hyperscale networking, with the sales force combined in January and a partner sales event scheduled for November. For fiscal 2027, HPE raised its networking segment growth outlook to 14% to 17%, compared with previous guidance of 8% to 12%.
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